The Canadian index (especially the banks) have shown a strong divergence lately. Moreover there will not be another round of QE.

Housing has begain to slip there and it's not going to take much for some of those banks to get creamed.

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This post is not very accurate. The index is down compared to the US because of the resource sector sell off that occurred gradually over a long period of time. Canadian banks are all close to historical highs again. The index is also down relatively speaking because the Canadian markets outperformed US markets for something like 7 or 8 years ( through 2011 ), and things have to even out eventually.

The chance that Canadian housing and banks are going to get creamed is almost zero. Huge immigrant demand to buy in Canada remains.

This post is not very accurate. The index is down compared to the US because of the resource sector sell off that occurred gradually over a long period of time. Canadian banks are all close to historical highs again. The index is also down relatively speaking because the Canadian markets outperformed US markets for something like 7 or 8 years ( through 2011 ), and things have to even out eventually.

The chance that Canadian housing and banks are going to get creamed is almost zero. Huge immigrant demand to buy in Canada remains.

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Canadian banks have taken a huge hit the past few days while the XLF was rammed to new highs. Do you and I have a different definition of divergence?

Almost zero huh? I remember that talk in 1999 and 2008. To say it's early, that's one thing, but to say there is a zero chance of a meltdown is just plain ignorant.